Sunday, April 29, 2012

Is this from the onion?

Since I'm still in the UK for two more days, here's another UK based post ...

The BBC posts a story from a Cardinal commenting on a tax plan.

Link here.

Did this person have advanced economics training?  No, he just thinks his seminary training gives him the intelligence to discuss economic policy.  One quote from him on those affected:  "People who are considering giving up their retirement homes".  Really?  Not having a 2nd home is the burden society bears?

Unfortunately, this person's statements echo what many think.  It's sad, really. Many people today think they're poor or struggling, as they talk on their smart phones with $100/month plans, watch their cable TV, surf with high-speed Internet, and drive a newer car.  Today's median consumer is much better off than the median consumer of 30 years ago - they don't feel that way, however, because of the "keeping up with the Jones" effect.  

The financial transactions tax will move business away from London.  As an American, I should actually hope it takes place, as it probably means thousands of jobs for the US.  I don't like seeing dumb policies implemented, however.

Sunday, April 15, 2012

In news we already knew ...

Robert Reich is a complete and total bozo.  Link here

On the one-year anniversary (April 15th, 2011 is "black Friday" in the poker world) of the day my freedom was lessened because of the actions of simpletons with similar thoughts, it's worth commenting on this.

Reich says: "In whatever form it comes, gambling is a scam."

This statement is so simplistic and simple-minded I am surprised even he would say it.  Reich, former democrat cabinet official, has been a clown for years, but this is a new low.  I know many, many people who enjoy wagering a few dollars, either with friends on a weekend, over the Internet, or in casinos.  I also know people who are on the industry side of things and every one of them is honest and hardworking.  In fact, if one could measure a "moral compass" of my friends who make their living with gambling or in the gambling industry and measure it against almost any group - these professional gamblers would score higher.

"Within the year, high-stakes poker will be available on every work desk and mobile phone in the nation."

This is personal to me, as I am angry that he wants to prevent me from playing Internet poker.  That was my main hobby.  I don't know what his hobby is, whether it's gardening, hunting, or just making a jackass of himself in these articles, but I'm sure he wouldn't appreciate if that hobby was taken from him.

Further, anybody who's an economist should know about the problems of prohibitions and the law of unintended consequences when you mess with the market.  It gets ugly.

Because of people like Reich, when the star spangled banner is played, I can't sing the "land of the free" part.  Why?  It's because of the Reich's in the world, who think they should make my choices for me and have taken away my freedom.  It's a sad day when this type of thought seems standard in our country.

/* Rant over

Thursday, April 12, 2012

Good news in Wisconsin

Wisconsin makes it tougher for wage discrimination lawsuits to be filed.  Link here.

Simple thinkers may claim that this is will cause more wage discrimination.  This is highly unlikely.  Anybody who's taken principles of microeconomics and/or lives in the real world knows that there isn't really any gender wage gap or wage gap between races.  At least not in the USA, where markets are relatively competitive.  Theoretically, it's not consistent with the idea that firms maximize profits.  Looking at the evidence, it's simply not happening.

Let's get a quote from this article:

Women earn 77 cents for every dollar that men make. In Wisconsin, it's 75 cents, according to the Wisconsin Alliance for Women’s Health (WAWH), which also estimates that families in the state "lose more than $4,000 per year due to unequal pay."

If you agree with WAWH and think ... "of course women (or insert any group here) are paid less for the same work" then I have a challenge for you.  Go become a millionaire.  It should be easy.  If (insert any group here) are making less - hire only that group.  Your labor costs will be so low that if you can do the other tasks in a remotely similar fashion to other firms, you'll be rich.

Don't bother trying this, however, as these gaps really don't exist as advertised.  There are thousands of firms who would exploit a gender/race/etc. gap if one existed.  The word "exploit" here sounds bad, but that exploitation would increase demand for the supposedly underpaid group.  For example, if women really were paid 80 cents on the dollar for the same work, a profit maximizing firm would hire only women.  That would increase the wages for women, however, while decreasing the wages for men.  Firms that want to maximize profits would exploit this gap until wages were equal.  Why can't firms do this now?  Because there's no wage gap to exploit and people are, in general, paid equally for equal work.

What Wisconsin has done is make it tougher for frivolousness lawsuits to be filed.  This is outstanding!  That will lower costs to firms, these costs will likely be passed along to workers in the form of higher wages.

Way to go Wisconsin.  Politically, maybe this is a bad move as democrats will try to confuse the issue for uneducated voters.  In terms of helping society, however, this is a great step!